Yorkville has a tentative agreement to buy the for $2.5 million, which is about $1 million less than the appraised value and $1.5 million than the price in the original lease agreement.
City Council members could vote on the deal in about two months, Mayor Gary Golinski said. If ultimately approved, the city would pay the $2.5 million over 20 years to Walker Custom Homes, plus 6 percent interest, Golinski said.
“At that price and interest rate, we’ll have a good cushion for capital improvements,” Golinski said.
He also anticipated that the facility would run an annual surplus high enough to eventually cover the total deficit it has generated since the city began leasing the facility in 2008. The annual deficit was about $77,000 in Fiscal Year 2009, about $50,200 in Fiscal Year 2010, and about $68,000 in the most recent fiscal year.
Meanwhile membership has increased from 977 in November 2010 to 1,467 in November 2011.
In December, aldermen against continuing the lease with Walker Custom Homes – which cost the city a $100,000 penalty. The tentative sales agreement includes waiving that $100,000 penalty, Golinski said.
, the city could purchase the REC Center for about $4 million, continue the lease through 2018, or opt out of the agreement in July 2013. City leaders needed to inform the landlords, Walker Custom Homes, if they are going to continue or opt out of the lease by the end of December.
On Thursday, Golinski complimented Ron Walker of Walker Custom Homes.
“From Day One, all he’s wanted to do was help the community out,” Golinski said.
Still, Golinski said he expected the vote on the purchase agreement would be close.
“I think if Ron Walker were to give us the facility, it would still be a 4-4 vote,” Golinski said.
That means Golinski would be casting the tie-breaking vote.